Category: Pollution

Coca-Cola is a multinational corporation that is considered to be one of the most profitable businesses in the entire world. As people live in a consumerist society and the age of globalization, various companies try to expand their marketing strategies in the territories of the world’s largest states to attract new clients. At the end of the twentieth century, the Coca-Cola transnational corporation was established in India and faced a plethora of issues regarding the local organizational and cultural standards.

What Aspects of U.S. Culture and of Indian Culture May Have Been Causes of Coke’s difficulties in India?

The first difficulty that the representatives of the Coca-Cola Company happened to face due to their campaign in the territory of India was caused by the concerns of the local government. The politicians from the Indian Ministry of Health requested the corporation’s managers and employees to disclose their products’ formulae and secret technologies that were used in the manufacturing process (Berglund and Helander 296). It would be proper to mention that the government of India did not welcome other businesses at that moment. However, the local politicians managed to detect that the soft drinks produced by Coca-Cola contained a tremendous amount of chemicals and pesticides. Therefore, the Minister of Health did want to allow the corporation’s expansion in the territory of India (Henrik 339). Moreover, different restrictions and fees were imposed on the Coca-Cola Company when regular citizens of the country faced the problem of water pollution caused by the factory’s manufacturing processes.

How Might Coca-Cola Have Responded Differently When This Situation First Occurred, Especially in Terms of Responding to Negative Perceptions Among Indians of Coke and other MNC?

The representatives of Coca-Cola in India should have considered responding to the requirements of the local government and residents quicker than they did in reality. It would be proper to ensure safety to the local consumers to gain more authority and respect among them (Chaklader and Gautam 101). Unfortunately, the company could not respond to the demanding needs of its customers due to several time-consuming laboratory tests and evaluations of their products’ main ingredients. Nevertheless, people of Indian culture think that a person or an organization that remains quiet for an extended period might be guilty of something and does not want to admit it (Karnani 13). Another inconsiderate mistake that many multinational corporations make in the Indian market regularly is that they try to defend themselves by putting particular blames on other manufacturers, instead of reconsidering their policies.

If Coca-Cola Wants to Obtain More of India’s Soft Drink Market, What Changes Does It Need to Make?

As India has certain problems in its economic system, it would be advantageous for the country to give jobs to its unemployed citizens. Coca-Cola should aim at providing career opportunities for the local inhabitants. Another step that the multinational corporation is recommended considering implies financial investments in the state’s cultural and national values (Mooij 35). Usually, people appreciate such deeds and thus trust a particular organization. Moreover, managers from Coca-Cola should address the problem of water pollution in India and build some filtering equipment to cause less harm to the environment. Unfortunately, many sources in India do not provide drinkable water. Therefore, this issue has to be eliminated with the help of different organizations that strive to occupy various markets in India. Also, it would be proper to learn the most important aspects of the local population’s culture to understand their primary needs and possible reactions to diverse marketing or business policies.

How Might Companies like Coca-Cola and PepsiCo Demonstrate Their Commitment to Working with Different Countries and Respecting the Cultural and Natural Environments of Those Societies?

As both Coca-Cola and PepsiCo companies were established in the United States of America, they should know that it is challenging to make a multicultural society pleased with every marketing and business decision. Therefore, it is essential to understand the primary needs and values of clients of different ethnic backgrounds by asking them to complete questionnaires or opinion polls (Spring 86). Feedback strategies let people from different countries unite and understand one another’s culture, which improves the quality of communication among the representatives of various states as well. In turn, the awareness of the local cultural aspects might be helpful for the future expansion of the companies mentioned above in particular locations. In conclusion, it is essential to learn and understand the national background of any country before communicating with its residents.

Conclusion

Coca-Cola is one of the most profitable businesses in the world as the company sells over a billion bottles of its drinks per day all over the world. When it first came to India, the country’s government was discouraged by the fact that some products of Coca-Cola contained pesticides. Despite the respect and authority that the company gained in other states, its business was not prospering in India due to the local population’s ethnic values that the corporation violated. Therefore, any business needs to understand diverse cultures and national qualities before going global as some people might be displeased with particular marketing policies or other actions of a certain company.

Works Cited

Berglund, Henrik, and Sofia Helander. “The Popular Struggle Against Coca-Cola in Plachimada, Kerala.” Journal of Developing Societies, vol. 31, no. 2, Jan. 2015, pp. 281–303., Web.

Berglund, Henrik. “Civil Society and Political Protest in India—The Case of Coca-Cola in Kerala.” India Review, vol. 16, no. 3, Mar. 2017, pp. 324–343., Web.

Chaklader, Barnali, and Neeran Gautam. “Efficient Water Management Through Public-Private Partnership Model: An Experiment in CSR by Coca-Cola India.” Vikalpa, vol. 38, no. 4, 2013, pp. 97–104., Web.

Karnani, Aneel G. “Corporate Social Responsibility Does Not Avert the Tragedy of the Commons — Case Study: Coca-Cola India.” Economics, Management, and Financial Markets, vol. 1, no. 3, 2014, pp. 11–23., Web.

Mooij, Marieke K. de. Global Marketing and Advertising: Understanding Cultural Paradoxes. Sage Publishing, 2014.

Spring, Joel. Globalization and Educational Rights: An Intercivilizational Analysis. Taylor and Francis, 2014.

Many businesses pay attention to environmentally friendly operations as the representatives of the general public care for nature today more than ever. However, some companies still face issues associated with environmental protection, which affects their performance adversely. For example, Thames Waters was recently charged with dumping waste in a river (Hargreaves, 2017). In the framework of ecocentrism, these actions are considered to be unethical as people affect nature adversely not because they satisfy their vital needs but because they are not willing to pay for utilization (Dussault, 2013). Fines can be treated as a strong solution to this issue even though it is not presupposed by the ethical theory discussed, as they ensure that some funds can be spent on protecting the environment. Still, it cannot be ignored that if the leader of Thames Waters had followed ecocentrism, he would have done everything possible to utilize wastes with minimal harm to nature, focusing on recycling.

Even though it is rather difficult to make an organization truly green, it is not impossible. Companies should do more for the environment to cover those issues they create, being committed to sustainability and economically viable. The environment is intrinsically valuable because it gives people a place and means to live. Thus, the policy of using innovative ways of energy conservation, recycling, and waste disposal is likely to benefit any company. To communicate it, leaders should encourage employees to participate in associated activities as volunteers and to fund the development of these innovations. Even though it may be costly and time-consuming, it can benefit the company enormously. It is important to educate personnel on the issue to avoid those problems that occur when some people are unwilling to accept changes. This policy is supported by ecocentrism and law as many countries consider such kind of environmental pollution to be a legal issue. In this way, no changes will be needed regardless of location.

References

Dussault, A. (2013). In search of ecocentric sentiments: Insights from the CAD model in moral psychology. Environmental Ethics, 35(4), 419-437.

Hargreaves, F. (201). Judge slams ‘inexplicable stupidity’ of people who flush nappies and tampons down toilets as Thames Water faces record fine for dumping a billion litres of waste. Web.

Introduction

As the People’s Republic of China has the largest population in the world, along with the largest inner consumption market, it faces a series of unique challenges regarding profitability, national security, environmental security, transportation, and supply in its own energy sector. Most of electricity in China is produced using local coal plants, which operate using hard fossil fuels (Reinhardt et al. 2). They are some of the greatest pollutants in China due to outdated technology, low output, great dispersion, and high coal consumption.

Although the Chinese government recognized the issue of pollution and announced a course for liberalization of the economy and a greater emphasis on ecology during the 12th 5-year plan, the transformation from a coal-based energy base to cleaner and more efficient production will be long and hard (Reinhardt et al. 14). Shenhua is one of China’s leading power companies, possessing great assets in coal excavation, transportation, and energy production.

Although it has been investing in innovative technologies, such as coal-to-liquids and coal-to-chemicals plants, the progress has been relatively slow (Reinhardt et al. 12). The purpose of this report is to provide an analysis and recommendations on how to reduce pollution while retaining market share, while Shenhua transforms itself into a more modern company.

The Existing Company Structure and the Causes of Pollution

Shenhua is not only one of the largest energy providers in China; it is also responsible for the extraction of 12.5% of yearly coal supplies used in the Chinese market (Reinhardt et al. 17). In addition, it owns its own railroad net, which it uses for supplying coal to the electric plants. The total number of coal plants is over 100, including the smaller and more outdated plants that were established in the regions at the beginning of the Chinese electrification efforts (Reinhardt et al. 8). In addition, Shenhua operates research efforts at home and overseas, seeking to produce liquid oils from coal. One of these efforts is the Ordos Project, but its operations are expected to start in 2020. Until then, the company needs a plan to reduce its pollution while maintaining services within the same price range.

Pollution comes from several sources. First, it is the coal mines. Although Shenhua has its own mines with relatively high standards of labor and high volumes of extraction, the majority of domestically produced coal (over 50%) comes from small private mines (Reinhardt et al. 17).

Not only do these small producers cause greater pollution due to lower standards of labor, they also have no access to the railroad network of Shenhua, meaning that they need to use trucks to deliver the goods, which is three times more expensive and contributes to the road congestion problems that China currently has (Cheng et al. 189). Finally, the last contribution to Shenhua’s pollution is made by the existence of small and inefficient coal plants in smaller communities, which do not produce enough energy to compensate for the amount of pollution they make into our atmosphere.

Potential Solutions

There is a number of potential solutions that could be implemented by Shenhua to reduce its ecological footprint and improve the overall quality of service. Some of the solutions are more expensive than others and will need to be taken into consideration along with other solutions aimed at reducing costs. Some of the proposed solutions are as follows:

• Heavily invest in coal power plant upgrades to reduce the amount of pollution they launch into the atmosphere. This solution will take time and will likely impose greater expenses upon the population and the industry, who are the main electricity consumers in China.
• Reduce the number of purchases from small coal producers by increasing imports from other countries. Currently, the prices on the internal coal markets are high making imports a viable opportunity. It would reduce the amount of pollution from the coal mines, as their production would either cease or be forced to upgrade to a new level of service. In addition, the congestion of the road system would be reduced.
• Invest in the Ordos project. An operational platform will be able to produce over 1 million barrels of liquid fuel starting from 2020, but until then the company would have to weather additional expenses (“Shenhua Ordos”).
• Propose the government to reduce the amount of taxation of the energy sector and liberalize the economy, thus freeing up additional finances to spend on anti-pollution projects.
• Close down small plants and redistribute some of the energy from the larger ones into communities. It would require the construction of additional energy lines, but the money saved from shutting down small and inefficient plants would be able to compensate for it.
• Provide railroad access to distant mining communities, alleviating road congestion and reducing transportation costs. This idea, however, is associated with significant expenditures, as railroad construction is very costly enterprise. It would be possible to get smaller producers to participate in the project.

As it is possible to see, some of the following propositions help reduce pollution, but are more costly, while others help save money. It is possible to combine both kinds of advancements, thus retaining the zero-sum in terms of costs while reducing the amount of pollution into the atmosphere.

Conclusions and Recommendations

Out of potential solutions, I believe the most promising ones include increasing the amount of imported coal from other countries to compensate for shortages of coal caused by stopping trade with smaller coal miners. Not only would that solution force to lower domestic prices but would also improve the quality of labor in China. In addition, it would also save money, as negotiating a favorable import contract with Russia is possible. Lastly, that solution would help in conservation of natural resources.

According to the case study, Shenhua produces excessive electricity, which is enough to trade it overseas. Nevertheless, China does not have any significant trade partners, as its closest neighbors are self-sufficient in terms of electricity. Therefore, the second recommended step would be to shut down small power plants and redirect the excess of energy to smaller communities. This choice would result in a zero-sum in terms of expenses, as the amount of money spent on centralizing the electric network would be compensated by the plant shutdown.

The money saved on plant shutdown and increased imports of coal from abroad could be spent on accelerating the Ordos project and providing new systems and filters for the existing coal power plants. All of these measures, in conjunction, would help reduce the amounts of pollution into the atmosphere by a significant margin, resulting in an eco-friendlier environment both in long-term and short-term economic perspectives. Some of the smaller coal mines should be conserved and kept untouched, to serve as potential reserves as part of the Chinese natural reserve assets for the future.

Works Cited

Cheng, Zhen et al. “Characteristics and Health Impacts of Particulate Matter Pollution in China (2001–2011).” Atmospheric Environment, vol. 65, 2013, pp. 186-194.

Reinhardt, Forest L., et al. “China Shenhua Energy Company.” Harvard Business School. 2014. Web.

“Shenhua Ordos CTL Project (Phase 2).” Global CSS Institute. 2015. Web.